Former NBA all Star Dunks Morgan Keegan for $1.46 Million
A former Chicago Bull and Los Angeles Lakers professional basketball star won a $1.46 million arbitration award against Morgan Keegan & Co. for losses related to mutual funds that made bets in debt and other mortgage-related holdings, according to an arbitration award.
Horace Grant, who retired from the Lakers in 2004, filed a securities arbitration claim in March against Morgan Keegan, a regional brokerage owned by Birmingham-based Regions Financial Corp., seeking more than $1.5 million for losses related to investments in four mutual funds.
Mr. Grant’s allegations included that Morgan Keegan failed to disclose the true risk of his investments and that they were speculative. He also alleged that fund managers weren’t properly supervised, according to a complaint filed with the dispute resolution arm of the Financial Industry Regulatory Authority, or Finra.
The allegations were related to investments in Regions Morgan Keegan Multi-Sector Income Fund, Regions Morgan Keegan High Income Fund, Regions Morgan Keegan Strategic Income Fund, and Regions Morgan Keegan Advantage Income Fund.
A Finra arbitration panel entered the award Friday.
Morgan Keegan has faced a flood of claims by investors who were hit by sizable losses in 2007 and 2008 in a total of seven funds that made bets in debt and other mortgage-related holdings.
“It’s an important win; a clear sign that arbitrators can whack a brokerage for subprime losses,” said Andrew Stoltmann, a Chicago-based attorney who represented Grant.
Mr. Grant’s 14-season career included three National Basketball Association championships with the Chicago Bulls, where he played power forward, and a fourth with the Lakers in 2001. He was named to the NBA All Defensive Team four times and to the NBA All Star Team during the 1993-1994 season. A Morgan Keegan spokeswoman didn’t immediately return a call or respond to emails seeking comment